“Exploring Monopolies and Oligopolies” Economics WK 4 Diss
“Exploring Monopolies and Oligopolies” Economics WK 4 Diss
Watch this video, Oligopolies and Monopolistic Competition, to help you prepare for this week’s discussion.
Use the company for which you currently work, a business with which your familiar, or a dream business you want to start to reply to these prompts:
- With your selected business in mind, determine if it is perfectly competitive, monopolistic competitive, an oligopoly, or pure monopoly. Explain how you drew your conclusion about its market structure.
- How does the business/firm in this industry determine the price it will charge for the products or services it sells?
Discuss with your peers:
- Read one of your peer’s posts and share an insight or question you have about that business and its market structure. Answer Peers Response Below –
Peer, I will stick to my business I talked about last week, a dental office. I worked in many offices over the years, and I do not know everything about the costs and how to start a practice,but I am familiar enough, and my ex-husband is a dentist… This had me stumped at first. The video talked about GOODS and not so much about SERVICES. Dentistry is a service oriented business, but after some research, I came to the conclusion that it falls into the “Monopolistic Competitor” category. They are all highly specialized, but also very competitive. I don’t know about where you live, but here in Huntsville, we have TONS of dentists. No one can just go open a dental office and start charging outrageous prices, they must attend 8 years of college minimum and pass the dental board exams, which makes the field very specialized and like medical schools, dental schools limit the number of students and so the market does not get saturated with doctors or dentists. I remember just finishing school and in my first office the old guy I worked for (he was 65, very old to a 24 year old) joked around about “getting together with the other dentists back in the day to determine what prices they should charge”. I knew that was illegal, and I hoped he was joking. He probably was not. I think many dentists today price their services based on the amount insurance will pay. They charge a certain percentage more, knowing that they will not pay it all. But, cash patients will and they make up a bit of difference in that way. All offices know what other dentists charge, and that also is taken into consideration. I think the cost of materials and overhead are but a small part when they set their fees. Most make much more than it takes to run and office and make a good living. They can charge the going rate, and all dentists seem to be inching up the “going rate”. The majority of that decision is based on the insurance table of rates they will pay. Reply to peer:
